Overview

Zenoku Hoshu (TYO:7164) is mainly engaged in the operation of credit guarantee business. The Company conducts credit guarantee services centered on mortgage guarantees. “A company that guarantees mortgage loans” is an independent guarantee company that does not belong to any affiliated company.

Taking advantage of this feature, the Company has concluded contracts with a number of financial institutions (banks, credit unions, credit unions, agricultural cooperatives, fishermen's cooperatives, labor unions, etc.) and has 13 sales offices mainly in major cities nationwide. In many cases, the mortgage loan amount is tens of millions of yen, and the financial institution should ask for a guarantee of solidarity for those who have the repayment capacity in the unlikely event. However, if a person who becomes a joint guarantor is forced to repay on behalf of the customer, it will be an additional burden for a normal life and the life base will be greatly shaken. By using a mortgage guarantee company such as our company, mortgage borrowing procedures from financial institutions will proceed smoothly, and in the unlikely event that a customer is in trouble, there will be no inconvenience to others Purchase is possible. (Note that even if the Company makes a temporary payment to the financial institution on behalf of the customer (reimbursement), the customer will be repaid by the Company.)1

Products

This section describes the products offered by the company. This information is primarily from the company web site.

Mortgage Guarantee

The Company has products that can meet various needs related to customers' housing funds. Their standard product, “Living Ichiban Next V”, covers a wide range of uses such as housing acquisition, refinancing, renovation and relocation, and can include various expenses associated with housing acquisition and loan borrowing. We are.  They also offer guarantee products that are compatible with the Flat 35 of the Housing Finance Support Organization, and guarantee products for borrowing bridging funds until the housing is completed. We also offer unsecured products for renovation funds, refinancing funds and borrowing expenses.

Their guarantee fees are categorized according to the mortgage guarantee amount, guarantee period, type of use of funds, customer income, years of service, collateral evaluation, etc. For example, in “Living Ichiban Next V”, there are five categories according to the customer's annual income ratio and collateral requirements, etc., and the normal guarantee fee applied to the 100% portion of the collateral price and the portion exceeding 100% There are categories of excess guarantee fees that apply, and customers with excellent attributes and collateral credits can use lower guarantee fees.2

Pre-screening in a short number of days is possible by using a pre-screening application by fax.
In addition, by using the payer income next business day answer system that emphasizes response speed, in principle, we will respond to the examination on the next business day after the application date.

Apartment Loan Guarantee

Due to the fact that a certain level of repayment funding is secured, we handle preferential treatment of guarantee fees for projects with lump sum contracts by major construction companies. Regarding the effectiveness of leasing (sub-lease * 1 ), there are various opinions due to various issues such as rent revision. However, for a certain period of time, we place emphasis on avoiding vacancy risk, and we recommend ancillary lending contracts.3
Large construction companies and management companies, etc., leasing the target properties together makes it possible to predict rent income with high accuracy from the design stage, so it is possible to propose a reasonable financial plan to the owner.
In addition, regardless of the occupancy status, the owner can receive a fixed amount of rent * 2 from the sub-lease company every month , ensuring stable income and supporting solid real estate rental management. 

Card Loan Guarantee

Additional guarantee service for existing customers of mortgage guarantee.4

Education Loan Guarantee

Uses of Funds5

  • Remittance (only overdraft)
  • Examination expenses (transportation, accommodation, and examination fees)
  • School payments such as enrollment and tuition fees
  • Moving expenses at the time of enrollment and appliances

and education associated with new life Loan refinancing (certificate lending only)
and applicable schools from private kindergartens to universities and graduate schools (depending on the loan format)

Financial Results

As a result of such efforts, the company reported an operating revenue of ¥17,623 million (up 8.5% compared to the same period of the previous fiscal year), an operating income of ¥12,805 million (up 6.8% compared to the same period of the previous fiscal year), an ordinary income of ¥13,394 million (up 7.7% compared to the same period of the previous fiscal year), and a net income of ¥9,241 million (up 6.7% compared to the same period of the previous fiscal year) during the six months ended September 30, 2019.6

Key points

While the outlook for overseas economies caused by trade matters remain in unclear conditions, the Japanese economy continued on a moderate recovery trend due to solid corporate earnings and sustained improvements in employment and income conditions, as well as a recovery in consumer spending.7

● In the housing market, while the government policies designed to support housing acquisitions and the low interest rate environment for housing loans continued, the number of owner-occupied houses and  condominiums out of the number of new housing remained high compared to the same period of the previous fiscal year.

● In the housing loan market, interest rates competition continued among financial institutions to acquire housing loans for new and secondhand housing.

● Operating revenue Operating revenue amounted to 17,623 million yen as outstanding guarantee exposure remained steady.

● Operating expenses Operating expenses progressed as initially forecasted and amounted to 4,818 million yen.

● Extraordinary income and loss Extraordinary loss amounted to 93 million yen mainly due to loss on valuation of investment securities owing to impairment changes.

● Net income As a result of above situations, net income amounted to 9,241 million yen.

Future Prospects

For the expansion of the business scale, Zenkoku Hosho Co has exerted its efforts to enhance the utilization rate of its credit guarantee products with the existing partnering financial institutions, and to increase the number of new contracts with prospective partnering financial institutions. In order to enhance the utilization rate of its credit guarantee products with the existing partnering financial institutions, the company made efforts in proposals to increase users for its data linkage system between the Company and the partnering financial institutions. The company also continued to hold presentation sessions on its credit guarantee products and undertake visiting activities to the sales branches. As measures to increase the number of new contracts with prospective partnering financial institutions, the company continuously performed marketing activities, and as a result, signed new contracts with four financial institutions, including one credit union, two JA cooperatives and one JF cooperative during the six months ended September 30, 2019.8

For the expansion of business domains, the company began consigning its business on managing and collecting its right to reimbursement to AKEBONO Servicer Co., Ltd., a company that became its subsidiary during the previous fiscal year, as well as continued its research on a new business model using AI and blockchain technology.

References

  1. ^ http://www.zenkoku.co.jp/customer/about.html
  2. ^ http://www.zenkoku.co.jp/service/loan_housing.html
  3. ^ http://www.zenkoku.co.jp/service/loan_apartment.html
  4. ^ http://www.zenkoku.co.jp/service/loan_card.html
  5. ^ http://www.zenkoku.co.jp/service/loan_education.html
  6. ^ http://contents.xj-storage.jp/xcontents/71640/e4c6efbe/3cd3/4525/a19e/cbfbfc2cfa85/20191105151343557s.pdf
  7. ^ http://contents.xj-storage.jp/xcontents/71640/deb31d8f/0e91/4f16/9c2e/543fb943a63c/20191112165505977s.pdf
  8. ^ http://contents.xj-storage.jp/xcontents/71640/e4c6efbe/3cd3/4525/a19e/cbfbfc2cfa85/20191105151343557s.pdf
Tags: JP:7164
Created by Asif Farooqui on 2020/02/04 08:06
     
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